So, with me updating my UBI plan twice in the past two years , first to $1100 a month, and now to $1200, it seems blatantly obvious that Andrew Yang should do the same. After all, the dude ran for president, and I imagine he will be running again in 2024. While he said he wouldn't when he first started the Forward party, he has dropped hints more lately that he or someone similar to him is thinking about it.
The history of $1000 a month
I started getting into basic income around 2013-2014 through the basic income subreddit. I was newly out of grad school, relatively speaking, and looking to find my niche in terms of politics. I had been frustrated with the direction of the American economy due to the great recession, and how broken everything seemed. I searched for years for answers to the greatest problems we faced, and eventually found UBI. Like most people, i originally thought the idea was too good to be true. But, being educated in social science, I did ask for evidence of the idea, and surprisingly there was a lot of relatively strong, and relatively well put together social science on it. While all social science has some limitations, after studying the issue from many angles, I quickly began to support it. But there was one final barrier to my support of the idea, and that was that of cost.
UBI isn't cheap. It cost $3 trillion or so at the time, and more recently, closer to $4 trillion for a good one. I knew this early on. And this seemed to be where UBI was considered the weakest. How do we raise the money? How do we fund this? Eventually, someone created a tool about funding the idea. It was some github or javascript type thing or something. Basically, it looked at the size of the US economy and had various methods of taxation to raise the money, including income taxation, VAT, etc. The tool was very much an oversimplification, but I could find that we could raise a UBI with roughly a 15-20% flat tax on the economy, or alternatively, around 40-45% for the entire federal budget PLUS a UBI. Through the coming months I fine tuned this, until I eventually was approached by a mod on the subreddit to write a blog article with my UBI plan. And I took them up on it and wrote my first ever UBI plan on their blog. I won't post it because again, want to remain anonymous, but my 2016 plan was a revision of this original work. It was pretty popular at the time and Scott Santens even used it at the time in his work, to discuss how UBI would reduce income inequality. From there, the idea stuck, and while we all kind of branched out from there, with Scott going on to be pretty famous in the basic income community at large, and me mostly sticking to internet activism due to my natural tendencies. So, $1000 a month was a pretty common rallying cry for the basic income community for a while. And I imagine as Andrew Yang consulted with Scott Santens in his 2020 campaign, he went with $1000 a month for his plan because it was the common number.
Before we got to that point, we need to explain why $1000 a month. When I was in the early phases of designing my first UBI plan, I really didn't know what a good amount would be. Clearly it should be high enough to live on, but not high enough it greatly discourages work. A little work reduction is fine, but if it threatens core industries, that's a problem. So, we kind of aimed for around the poverty line, give or take. In 2014, that was $11,670. So we wanted something similar to that. Three amounts were considered for me. $10,000, $12,000, and $15,000. All three were attractive sounding flat amounts. All three were aiming for the general zone we were aiming for.
Originally, because I didn't know what I was doing, I looked at $10,000. I figured at least this was feasible, and anything lower than this wouldn't even be a full basic income. Hence why I talk about full UBIs and partial UBIs. Full UBIs are ideally above the poverty line, but at the very least, close enough to it to get you most of the way there. I figured any amount under $10,000 wasn't even worth looking at. $12,000 was a much better target and above the poverty line. And not only is $12,000 a flat amount per year, it's also flat per month, being able to be marketed at $1000 a month. And given it was above the poverty line at the time, it seemed like the perfect amount. What about $15,000? Well, that was mostly hypothetical, and seemed a bit high and optimistic. And I really couldn't make the numbers work without higher amounts of sacrifice. $12,000 was hard enough to make work as it was, and I considered it the most that was realistic. So I stuck with $12,000, and even that seemed to be very good in practice, and would do a lot of good things for humanity.
It seemed like the community seemed to rally roughly around that amount ever since.
Just to add a footnote here, I'm not saying I'm the only one who came up with the idea and that it belongs to me. i'm sure anyone at the time was looking at it too and coming to similar conclusions that I was. I was just explaining the thought process at the time. But I have noted that I did discuss the concept with Santens at the time, and since then he went on to advise Yang, so it makes sense that those original discussions might have influenced him, and thus influenced yang. So, I don't care if I get credit for it or not. I'm just explaining my side of the story here, and my logic behind it.
The fact is, In 2014, $12,000 was just...a good amount. it was the best amount I could think of for a UBI. $10000 was too low, and while it was popular in some plans from the 2000s I read like Allan Sheahan's plan who wrote about a $10,000 UBI in 2006, by 2014, $10,000 was becoming on the low side due to inflation and was no longer enough to keep up with the poverty line. If anything, $10,000 in 2006 was like $12,000 in 2014. And that's kind of why we need to once again update the amount.
$1000 a month since 2014 and declining value
As we all know, inflation is a thing. It's always a thing in a healthy economy to some extent, and a lot more recently, it's a big thing. Every year, the dollar loses a little bit of its value. Normally it's around 2-3%. Last year it was almost 8%. And that means that $12,000 isn't worth what it was in 2014. It has declined in value, and the amount needs to be raised.
I mean let's just compare my UBI supported amounts over time to see the clear problem here.
Year | UBI amount | Poverty line | % of FPL |
2014 | $12,000 | $11,670 | 102.83% |
2015 | $12,000 | $11,770 | 101.95% |
2016 | $12,000 | $11,880 | 101.01% |
2017 | $12,000 | $12,060 | 99.50% |
2018 | $12,000 | $12,140 | 98.85% |
2019 | $12,000 | $12,490 | 96.08% |
2020 | $12,000 | $12,760 | 94.04% |
2021 | $13,200 | $12,880 | 102.48% |
2022 | $14,400 | $13,590 | 105.96% |
I mean, in 2014, my UBI was almost 103% of the poverty line. And it was fine that I reused the number in 2016, because it was still good. Honestly, by the time I got to 2019, it should've been raised. But, yang ran on the now deprecated $1000 a month amount, and given it was kinda sorta good enough, nowadays, it's not really. I mean if I let it go until now, it would only be 88% of the poverty line. That's not far off from where 2006's $10,000 number was in 2014.
$12,000 a year is still a fine amount to get your foot in the door, but it's starting to now border on "UBI lite" territory. where it's more a partial UBI than a full one. Although to be fair most "partial UBIs" I create are in the 50-80% range of the poverty line, rather than close to 100%.
The fact is, I probably should've upgraded to $12,600 or $13,200 in 2019. I mean, I knew that every passing year $12,000 a year was becoming increasingly easy to fund. And if we did that, well maybe my UBI curve would've looked like this:
Year | UBI amount | Poverty line | % of FPL |
2014 | $12,000 | $11,670 | 102.83% |
2015 | $12,000 | $11,770 | 101.95% |
2016 | $12,000 | $11,880 | 101.01% |
2017 | $12,000 | $12,060 | 99.50% |
2018 | $12,000 | $12,140 | 98.85% |
2019 | $13,200 | $12,490 | 105.68% |
2020 | $13,200 | $12,760 | 103.45% |
2021 | $13,200 | $12,880 | 102.48% |
2022 | $14,400 | $13,590 | 105.96% |
And let's face it, that's fine. If you're going to let an amount stay for a couple years, it doesn't hurt to overshoot a bit. That's actually why I aimed for $14,400 rather than $13,800 or $14,000 which both would've been adequate. I figure that I need the $14,400 amount if I want to outlast another year with high inflation, or alternatively I want my plan to weather the next couple years at a more normal inflation level.
Conclusion
And this is why I'm saying Yang should upgrade his UBI plan. When I came up with the $12,000 number in 2014, I intended for UBI to be an above poverty line "living UBI" sort of situation. And while I highly doubt it will be truly livable without work without at least another adult in the household in practice, mostly due to rent prices, the fact is, UBI should at least try to eliminate poverty. By the time Yang adopted it for the 2020 cycle, it just kind of sort of cut it. It was getting a little anemic and while it would still mostly do the job as it was still around 94-96% of the poverty line, it would need to be updated quickly after implementation to reach a higher amount.
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